Shot sale on more than 1 mortgage

Hello everyone. Is conducting a short sale on two or mortgages(on the same property) as simple as making arrangements with each bank, or is there a more streamline approach?

Thanks Scott

If your asking this question, then your not ready to attempt a SS on your own. I would suggest getting some reading material or partnering up with someone local in your REIA clubs that handles SS.

But to answer your question… There is alot to do in a SS, its not as cut and dry and some think. You need to have the home owner sign a limited power of attorney over to you, request a short sale packet from each lien holder, get a BPO, convince the bank why they should settle for less and show them why plus more. One key to a successful SS is also the hardship letter you need the homeowner to write (or you do it and they sign it and approve it).
A typical SS if done without problems can still take 6weeks but many can drag on for several month even before the bank makes a decision on your offer.

Why a power of attorney?

Isn’t the authorization to release form all we need?


yrush, thank you for your reply. You are correct I do not have much SS knowledge. Do you have any reccomendation for reading material. I live in Vegas and have not been able to find anybody very knowledegable and willing to help.

Thanks Scott

A power of attorney (limited to a specific property for a specific time frame - not a general power of attorney) is required by the lenders since you will, in fact, be acting for the seller. The lender will treat everything that comes to them from you as if it came from the seller.

Scott. I do not know the LV market much but I would recommend you attend a local REIA meeting , there are probably at least 3 groups there since it is a big market. Also start calling realtors up. I would recommend you call the offices and ask for the broker of the office and let them know what your looking for and who in their office they recommend or if they know another realtor specializing in foreclosures. Rember if the bank already owns the property (REO) then you need to go thru a broker anyway. Also my preforeclosures are listed on MLS and certain realtors check out the local court house for deals as well. Tell them you need help, finding and negotiating terms as well as working with the bank. But if there is a deal, you have no problem acting on it right away. They work on commission so they want to be paid and they will if you close.
Also title companies are a great source for realtor referrals on this subject as well.

As for reading material…I really can not recommend anything since I never read on book on the subject.

Hey Scott. I was just reading through and I thought I’d share my 2 cents. I have done a few short sales, and I think that most people make them out to be scarier than they really are. I personally have never used a POA, and I’ve never had a bank request one. The authorization has always been good enough. I’d suggest using one and getting a POA if the bank specifically askes for one afterwards.

And really, you are just making arrangements with both lenders. Often, I’ll start a SS without anything except a signed auth and contract. Call the lender up, don’t tell them that you are an investor, tell them that you are a friend of the homeowner and are looking to help them out. They’ll tell you what you need.

As far as the BPO, if the lender is interested in your offer, they will take care of that. There are some finer points of influencing the BPO, and you can pick up tips on doing that on these boards.

Convincing the bank that the property is worth less than it really is is fairly simple. Take pictures of damage and find the lowest comps you can, and submit them to the lender. Don’t expect to be able to pull the wool too far over their eyes. They aren’t stupid. (Sometimes, that’s not true.)

Anyway, a good way to learn it is to do it. Make the phonecall. It’s only real estate, and your dealing with people. Worst case scenario is that you don’t get the deal. You get the experience.

Good luck!


Not a good idea. Honesty is the best policy. They’ll see right through you. How many friends do YOU have that know how to do a short sale?